Indonesia to Utilize Cash Buffer in 2023

The government will allocate this year's unused funds (SiLPA) to repay some loans in 2023. Finance Minister Sri Mulyani Indrawati warned about possible volatile markets and a global economic slowdown next year, even though Indonesia's fiscal position is quite strong, thanks to surging tax revenue from the commodity sector and post-pandemic economic recovery.

As of the end of October, the government managed to collect Rp 270.4 trillion or around US$17.26 billion of unused funds, despite a Rp 169.5-trillion budget deficit or 0.91 percent of the Gross Domestic Product (GDP). "We will accumulate a significant amount of unused funds," Finance Minister Sri Mulyani Indrawati said at a press conference. However, the government expects next year's budget deficit to reach 2.8 percent of GDP, assuming the economy will grow 5.3 percent, slightly higher than the economic growth projection of 5 to 5.3 percent in 2022.